Melbourne set to break 1000 auction weekend

The Melbourne home auction market resumed last weekend with a surge in activity following the previous weekend’s market shutdown due to grand final and holiday distractions.

Auction numbers will rise again this weekend with the market set to host more than 1000 auctions for the first time since Saturday May. Listings, although higher, will still be just ahead of last weekend’s offerings of 966 auctions and well down again on the 1232 homes that went under the hammer during the same weekend last year.

Melbourne’s west is again the most popular region for auctions this weekend with 174, followed by the inner south with 132, the inner east 129, the inner city 127, the north-east 126, the outer east 119, the north 96 and the south-east with 51 auctions so far scheduled on Saturday. More are expected to come.

Reservoir is yet again the most popular auction suburb in Melbourne this Saturday with 23, followed by Essendon and Glen Iris each with 15, Glen Waverley 14, Richmond 13 and St Albans, South Yarra and Craigieburn, which will each host 12 auctions on Saturday.

The Melbourne weekend auction market resumed in full stride last weekend following the previous weekend’s break and recorded a clearance rate of 79.8 per cent. Although below the previous weekend’s holiday-affected 87.1 per cent, the result was again above the 74.2 per cent recorded for the same weekend last year.

Last Saturday’s result was the highest recorded on a full weekend in the spring selling season so far this year. The local market has produced remarkably consistent results for sellers during the past two months, with the lowest result the 77.5 per cent recorded on September. 

Regional results also remain consistent with all areas reporting clearance rates above 70 per cent last weekend. 

Strong auction market activity is predictably translating to higher prices, which will be welcomed by Melbourne home owners. Potential first home buyers, however, will not welcome higher prices, which will act to offset the benefits of record-low interest rates and a highly competitive lending environment.

Latest Australian Bureau of Statistics data shows loans to Victorian first home buyers fell 1 per cent during August to 2186 – the lowest monthly result since March. Despite the fall, lending to local first home buyers has increased 4.4 per cent during the first eight months of this year compared with the same period last year.

The average first home buyer loan reported in August was $315,100 – a decrease of 1.8 per cent compared with August last year

Dr Andrew Wilson is Domain Group’s chief economist

Twitter @DocAndrewWilson